Published on 18/07/2019 9:12:35 AM | Source: Motilal Oswal Services Ltd

Neutral Godrej Consumer Ltd For The Target Rs.700 - Motilal Oswal

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Godrej Consumer (GCPL) update on 1QFY20


* During the quarter, GCPL witnessed relatively soft demand across some of the geographies of operations.

* In India, demand continued to be challenging, impacted by a general consumption slowdown. Despite this, GCPL recorded volume growth of close to mid-single-digits. The uplift in volume growth relative to the recent past quarters was led by new product launches, effective marketing campaigns, consumer offers and price offs. Sales value growth in the quarter was marginally better than that in the last quarter. The company looks forward to an improvement in consumer demand in the quarters ahead.

* In Indonesia, GCPL recorded close to mid-single-digit constant currency sales growth amidst a soft demand environment. While the start has been relatively slow, the company remains confident of delivering ahead of category and stable sales growth during the course of the year, driven by new product launches and further expansion of general trade distribution (Project Rise).

* In GAUM (Godrej Africa, USA, Middle East), GCPL recorded low-single-digit constant currency sales growth. It witnessed mixed performance across subclusters. West and South Africa recorded steady growth during the quarter. GCPL will continue to drive the scale-up of wet hair care and the re-launch of the Darling brand in dry hair category, along with expansion in distribution, to deliver profitable sales growth for the year.


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